My Lords, I am grateful for the privilege of opening today’s debate on the Motion for an humble Address. Today, I shall outline the Government’s plans to support the economy, energy and the environment.
Covid-19 was an unprecedented crisis and, in response, this Government took unprecedented action, providing nearly £400 billion to protect lives and livelihoods from the pandemic’s economic impact. It is thanks to this decisive response that the economy was able to recover faster than expected. That resurgence was accompanied by a labour market that outperformed expectations, with unemployment returning to below its pre-pandemic rate. None the less, there are significant challenges ahead.
Pressure on global supply chains and elevated energy prices, as the world unlocks from the Covid-19 pandemic, had meant that the cost of living was already on the rise. And now the unprovoked invasion of Ukraine has further driven up energy prices for households. The Government are acutely aware of the pressure that people face right now. That is why we are providing support worth over £22 billion in this financial year to help people through these difficult times.
We are also mindful of our responsibility to secure the economy over the longer term. Our spending on public debt interest repayments has reached the point where it now exceeds the budget for schools. Clearly, this is unsustainable. That is why we have taken tough and responsible decisions to repair public finances and return them to a tenable path. As a result, our debt is now on track to fall in the next few years, freeing up greater fiscal firepower to respond to future shocks and build economic security. A responsible approach to our national debt is just one element of how this Government are safeguarding our future economic health and our national well-being.
The legislation we are debating today will also play a significant part in achieving those goals. These measures will support key sectors such as food and farming and financial services. They will shield people from rising energy prices and consumer rip-offs, while preventing workers paying the price of business failure. They will also protect the environment and speed our transition to a net-zero economy.
I turn first to the financial services and markets Bill. The UK’s financial services sector is one of the most open, innovative and dynamic in the world. It is not just an industry in its own right but the engine of our economy. It employs over 2.3 million people throughout the country and contributes £75 billion in tax revenue. It is therefore right that we act to secure our position as a global leader for the sector over the long term. Our departure from the European Union means that there is now an opportunity to better tailor our legislation to better suit our markets. In his speech at Mansion House last year, my right honourable friend the Chancellor set out our ambitious visions for an open, green and technologically advanced financial services sector that is globally competitive and acts in the interests of communities and citizens, creating jobs, supporting businesses and powering growth across all of the UK.
This Bill represents further progress towards making this vision for financial services a reality. It will build on the Financial Services Act 2021 and will ensure that the sector continues to deliver for individuals and businesses across the country. In addition, the Bill will help the country seize the full opportunities presented by Brexit by repealing retained EU law and establishing a coherent, agile and internationally respected approach to financial services regulation that is specifically designed for the UK. This includes giving our financial services regulators new objectives to ensure greater focus on growth and international competitiveness. We will also reform the rules that regulate our capital markets to remove red tape and promote investment.
The Bill will fulfil important priorities for the Government by safeguarding our robust regulatory standards, which are a cornerstone of our attractiveness to investors and maintain the stability and soundness of our financial markets. In addition, it will include significant measures to promote consumer protection, helping to protect the easy access to cash on which so many people rely, boosting consumer confidence by including additional protections for those investing or using financial products, and providing greater support for scam victims.
Not only has the UK been a financial services hub for centuries, it has also long been known for its pioneering infrastructure. Our railway network, Shropshire’s Iron Bridge and the Severn crossings are all illustrations of how UK engineers shaped this country. But, as my right honourable friend the Prime Minister has said previously, for too long now Governments of every stripe have failed to invest enough in infrastructure. If we are to deal with two of the biggest challenges facing this country—the need to level up the country and to cut our carbon dependence—we must address this challenge head on. That is why last year we launched the UK Infrastructure Bank. Thanks to £22 billion of capacity, the bank will be able to support infrastructure investment and the levelling up of the whole UK. In turn, this will boost private sector confidence, unlocking a further £18 billion of investment.
The UK Infrastructure Bank Bill will finalise the bank’s set-up and ensure that it is a long-lasting institution. It will set out its objectives—to tackle climate change and support regional and local economic growth—in legislation, as well as giving the bank a full range of spending and lending powers, so it can benefit communities across the country and help the UK achieve its net-zero goals.
As well as strengthening investment, this Queen’s Speech took steps towards ensuring that investors, employees and consumers can be confident that they have the full facts about businesses’ financial health. When big companies go bust, the impact can be far reaching, and all too often it is workers and taxpayers who pay the price. Recent company collapses such as Thomas Cook, Carillion and BHS have underlined the need for proportionate and targeted audit, corporate governance and insolvency reforms. The draft audit, corporate governance and insolvency Bill will set out measures to rebuild trust in this area. Ultimately, the Bill will seek to safeguard jobs, reduce the economic and social harm from sudden company failures and reinforce the UK’s reputation as a great place to invest. It will include measures to boost resilience, competition and choice in the audit market, and it will establish a strengthened regulator and ways of holding business directors to account. These are complex and significant measures and it is critical that we get this reform right. That is why the Government are bringing forward this legislation in draft.
I turn to economic crime, which costs the UK an estimated £8.4 billion a year. We took recent urgent action with the Economic Crime (Transparency and Enforcement) Act, and now, as we committed to then, we are going further by bringing forward the economic crime and corporate transparency Bill. The Bill will strengthen the UK’s reputation as a place where legitimate business can thrive, and it will ensure that there is no place to hide dirty money. The Bill will include significant reforms to strengthen the role of Companies House, reforms to prevent the abuse of limited partnerships, new powers to seize crypto assets from criminals and reforms to give businesses greater confidence to share information on suspected money laundering.
Consumers also need to be confident that they will be supported if their relationship with a firm goes wrong. Already, the UK boasts a strong set of consumer rights,
which are enforced through multiple routes. None the less, problems with purchases cost consumers £23 billion annually and there is evidence that competitive pressure among firms may have been stronger in the past than it is today. Now that we have left the EU, we can take clear action to address this problem by tailoring our legislation to support both consumers and businesses in a more agile way, while maintaining our high standards. The draft digital markets, competition and consumer legislation will boost consumers’ rights, strengthen enforcement and promote more competition in UK markets. This legislation will tackle bad business practices such as subscription traps and fake reviews, which cost consumers money. It will also clamp down on cartels and other activities that stifle competition. The Bill will also give the Competition and Markets Authority more powers to crack down on bad businesses ripping off consumers. In short, this legislation will help consumers keep more of their hard-earned cash.
When it comes to the cost of living, rising energy prices are being felt by households up and down the country. The Government are acting, with support to consumers worth over £9 billion and, importantly, a long-term plan for our energy security. Our recently published British Energy Security Strategy will help tackle rising bills and, alongside the Prime Minister’s 10-point plan and the Net Zero Strategy, drive £100 billion of private sector investment into new British industries, supporting the creation of around 480,000 clean energy jobs by 2030.
The energy Bill will deliver even more for UK families and businesses as we seek to transition to a cleaner, more affordable and more secure energy system. It will ensure that consumers remain protected by the price cap and that heat networks are regulated, helping to lift households out of fuel poverty. This landmark Bill will also fire the starting gun on new low-carbon technologies, such as hydrogen and carbon capture, utilisation and storage, by introducing state-of-the-art business models. It will also support the growth of new industries, unlocking tens of thousands of new skilled jobs across the UK. This reshaping of our energy industry will be overseen by a new future system operator, which will be charged with driving progress towards net zero, energy security and minimising the costs facing consumers.